(Washington, D.C.)  Congresswoman Cathy McMorris, Vice-Chair of the Water and Power Subcommittee, conducted an oversight hearing today on "How the Federal Power Marketing Administrations are Implementing the Energy Policy Act of 2005 and an Assessment of the Proposed Fiscal Year 2007 Budgets for these Agencies."

“Today’s hearing highlighted that hydropower is a clean, reliable source of energy for the Pacific Northwest and our nation,” said McMorris. “Eastern Washington’s economy was built on inexpensive renewable energy from our dams and our communities and businesses depend on the benefits of low-cost federal power.”

The hearing featured testimony from Western electricity customers and administrators of each of the four Power Marketing Administrations (PMAs) on the value of federal hydropower generation and transmission to our Nation's communities. Dan Peterson, Pend Oreille County Public Utility District Commissioner, testified at the hearing on the impact of the Bonneville Power Administration (BPA) rule change in the 2007 budget. In the Pacific Northwest, 40 percent of electricity sales and 75 percent of the transmission come from the BPA.

“The Northwest produces much of the cleanest power in the nation,” said Peterson. “At a time when the President is urging our nation to wean itself off of foreign oil and showcase renewable energy, it makes no sense to arbitrarily increase the cost of a large, clean, domestic hydro resource. The budget proposal, if implemented, will raise rates. It sets bad precedent, hurts my neighbor PUD, and could do unnecessary damage to the Pacific Northwest region.”

“This proposal is designed to circumvent Congressional approval,” said Chairman Richard W. Pombo. “Members from both parties today joined together against this rate impacting proposal. Making hydropower more expensive at a time of increasing energy prices and against the bipartisan will of Congress is not the best way to solve our energy problems.”

“Dan Peterson’s testimony was useful in accessing the direct impact that will be felt as a result of BPA rate changes,” said McMorris. “The Administration’s proposal of requiring Bonneville to use surplus revenues to reduce debt sounds good on paper, but it ignores the reality that debt is already being repaid. It also could raise electricity rates by a projected 10 percent, hurting Northwest consumers and crippling an agency that needs financial flexibility.”

Last month, McMorris testified to the House Budget Committee and criticized the proposed rule change that would increase energy rates for Pacific Northwest customers.